Amazon to collect sales tax on Texas purchases starting Sunday

Published 10:13 pm, Friday, June 29, 2012

In late April, Texas Comptroller Susan Combs announced a deal with Amazon.com for the powerhouse online retailer to start collecting sales taxes as of July 1 on purchases made in the state.

Sunday is July 1, and for many bricks-and-mortar retailers who felt Amazon got an unfair advantage, the start date couldn't have come sooner.

On Friday, the Alliance for Main Street Fairness, a coalition of business owners who want Amazon and other Internet retailers in all 50 states to collect sales taxes, said in a statement: "The end of special treatment for online retailers in the Lone Star State sends a strong message to Washington, D.C., that a true free market requires federal e-fairness legislation."

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One local retailer believes it will be good for Texas businesses and for the state when its consumers pay sales tax on their Amazon purchases.

"We are thrilled that Amazon will finally have to start collecting," said Valerie Koehler, owner of Blue Willow Bookshop in west Houston. "It's always boggled my mind that they didn't."

Along with selling relatively in-expensive products like books, Amazon deals in big-ticket items such as jewelry and electronics, Koehler said, "and that's been a pretty substantial loss of income for the state."

"I think it will help small businesses tremendously," said Irwin Miller, a counselor at SCORE, a group of retired executives who advise small-business owners.

Currently, Amazon collects sales tax in Kansas, Kentucky, North Dakota, New York and Washington, Amazon spokesman Scott Stanzel noted. And along with Texas, Amazon has reached agreements with seven other states to collect sales tax, Stanzel said.

Despite having to pay sales tax on purchases, consumers in those states will continue to shop with Amazon because it offers low prices, large selection and fast delivery, Stanzel said.

The agreement that Combs announced in April also called for the Seattle-based Amazon to create at least 2,500 jobs in the state over the next four years and make at least $200 million in capital improvements in Texas.

R.J. DeSilva, a spokesman for the comptroller's officer, said he had no updates on when or where Amazon would begin creating those jobs or making capital improvements in Texas, nor did Stanzel.

Combs said in April that the state loses an estimated $600 million annually in potential revenue from Internet sales from all sources.